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5-Star Stocks Poised to Pop: Pharmaceutical Product

Market-trouncing returns could be written in these five stars.

Based on the aggregated intelligence of 130,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, contract drug research company Pharmaceutical Product Development(NASDAQ:PPDI) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at PPD's business and see what CAPS investors are saying about the stock right now.

Over on CAPS, fully 440 of the 446 members who have rated PPD -- some 98.7% -- believe the stock will outperform the S&P 500 going forward. These bulls include All-Star TSIF, who is ranked in the top 5% of our community, and SmoothHughes.

Decent margins, no debt, good cash flow. Somewhat recession proof in that medical companies need a continuous stream of new products to offset those losing patent protection. A full range of services that are usually farmed out by the "big boys" who don't want to keep specialized staff.

Nice balance sheet with $4/share in cash and no debt. The company has strong founding management and is in a good sector. Pharmaceuticals should have a strong tail wind with the aging baby boomers and the rapid advances in biochemistry. National medicine might even help as big pharma looks to reduce costs through more outsourcing.

What do you think about PPD, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 130,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.